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House Approves Republican Deficit-Cutting Plan

By: Alan Fram, Associated Press
By: Alan Fram, Associated Press

Washington, D.C. (AP) - Republicans pushed an election-year, $3.5 trillion budget through the House on Thursday that relies on biting spending cuts and a revamping of Medicare to curb massive federal deficits, drawing a sharp contrast with how President Barack Obama and Democrats would tackle the nation's fiscal problems.

House passage came on a near party-line, 228-191 vote. With its doom guaranteed in the Democratic-run Senate, the House measure was essentially a political stage on which Republicans showed voters how they would run Washington if they win control in the November elections - and Democrats fired back by doing the same.

The GOP plan features sharper deficit reduction and starkly less government than Democrats want. It would block Obama's proposal to boost taxes on the wealthy and would instead lower income tax rates while erasing many unspecified tax breaks. Obama's budget would raise taxes on families making above $250,000 and on oil and gas companies, add funds for roads and schools and cull modest savings from domestic programs.

"We think America is on the wrong track," said House Budget Committee Chairman Paul Ryan, R-Wis., the spending plan's chief author and a rising party star who is sometimes mentioned as a vice presidential prospect. "We think the president is bringing us to a debt crisis and a welfare state in decline."

Democrats accused the GOP of writing a plan that would end the age-old guarantee that Medicare would cover most of seniors' medical bills and would slash transportation, research and other programs far too deeply, even as the measure would protect the rich from Obama's proposed tax hikes.

"The more people know about that budget, the more people know it hurts them in their lives," said House Minority Leader Nancy Pelosi, D-Calif.

Congress' budget is a nonbinding road map that suggests tax and spending changes lawmakers should make in separate, later legislation. A House-Senate stalemate over the fiscal blueprint would have scant practical impact as Congress tackles what little budget work it is expected to address before the November elections.

Final approval in the House came after lawmakers swatted down a slew of alternatives over the past two days, including a package by the most conservative Republicans that featured even sharper spending cuts and deeper deficit reduction than Ryan's leadership-backed plan. The conservative plan claimed to turn this year's $1.2 trillion federal deficit into a balanced budget in five years. Most analysts consider that unachievable because few lawmakers would vote for the package's proposed cuts.

None of the competing budgets by Ryan, Obama or House Democrats claim to balance the budget within the next decade.

Underlining the growing influence of tea party and other conservative Republicans, a clear majority of GOP lawmakers voted for the conservatives' plan. It was defeated because virtually every Democrat voted against it.

Republicans forced a vote on Obama's budget and it was rejected 414-0, with Democrats worried that a "yes" vote would provide fodder for campaign ads accusing them of backing anything voters might dislike in the president's plan.

Also rejected was a compromise mix of tax increases and spending cuts offered by moderates of both parties and modeled on recommendations issued by Obama's bipartisan deficit reduction commission. It got only 38 votes.

The GOP package would slice everything from food stamps to transportation. It envisions collapsing the current six income tax rates into just two, with a top rate of 25 percent compared with today's 35 percent. It would also eliminate unspecified tax breaks.

"Our team actually went and made the tough choices, made the tough choices to preserve freedom in America and to deal with our fiscal nightmare," said House Speaker John Boehner, R-Ohio.

Democrats said they, too, were eager to stanch deficits that now exceed $1 trillion annually. But they said it needed to be done in a more balanced way, with rich and poor alike sharing the load.

"The Republican budget kicks the middle class in the stomach," said Rep. Steve Israel, D-N.Y.

The House GOP budget would cut spending by $5.3 trillion more over the next decade than Obama's would - out of more than $40 trillion that would still be spent during that period. It envisions repeal of the president's health care overhaul and sets a course for deep reductions for highway and rail projects, research and aid to college students and farmers while easing planned defense cuts.

It also would cut taxes by $2 trillion more than the president's plan over that time, leaving Republicans seeking about $3.3 trillion in deeper deficit reduction than Obama.

Drawing the most political heat was Ryan's plan for Medicare, the $500 billion-a-year health insurance program for older Americans that all sides agree is growing so fast its future financing is shaky. Both parties know that seniors vote in high numbers and care passionately about the program.

Republicans would leave the plan alone for retirees and those near retirement, letting the government continue paying much of their doctors' and hospital bills.

For younger people, Medicare would be reshaped into a voucher-like system in which the government would subsidize people's health care costs. Republicans say that would drive down federal costs by giving seniors a menu of options that compete with each other. Democrats say government payments won't keep up with the rapid inflation of medical costs, leaving many beneficiaries struggling to afford the care they need.

Republicans would turn Medicaid, the nearly $300 billion-a-year federal-state health insurance program for the poor, into a grant that states could use as they wish. They also would trim its growth by $800 billion over the next decade, out of spending during that time that is expected to exceed $4 trillion.


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